To reiterate, last week’s low (7,321) closely matched the breakout point, also the April peak (7,320). This is bullish price action, and dovetails with a similar successful retest on the S&P 500.

Looking elsewhere, the Dow Jones Industrial Average has staged a belated technical breakout.

Recall that resistance formerly spanned from 24,859 to 24,876, levels matching the April peak and the 2017 peak.

The Dow has ventured slightly higher this week, rising to challenge the marquee 25,000 mark.

The slight breakout resolves a double bottom — defined by the March and May lows — placing the index in less-cluttered territory. Until this week, the Dow was the lone widely-tracked U.S. benchmark still capped by the April peak.

Meanwhile, the S&P 500 is digesting the steep early-May rally.

To reiterate, the sustained May breakout is constructive, and dovetails with similar Nasdaq price action.

The bigger picture

Collectively, the bigger-picture backdrop supports a bullish bias, and it continues to strengthen.

On a headline basis, the S&P 500 and Nasdaq Composite have sustained the May breakout, effectively nailing well-defined support — S&P 2,710 and Nasdaq 7,320.

Meanwhile, the Dow industrials have broken out belatedly, tagging a new high, and the 25,000 mark, just this week.

Moving to the small-caps, the iShares Russell 2000 ETF has extended its breakout, notching four straight record closes.

Recent strength resolves a double bottom underpinned by the 200-day moving average. The breakout point (160.00) pivots to well-defined support.

Meanwhile, the S&P MidCap 400 is challenging nearly four-month highs

Resistance broadly spans from about 357.10 to 357.90, and is currently under siege.

Tuesday’s Watch List

The charts below detail names that are technically well positioned. These are radar screen names — sectors or stocks poised to move in the near term. For the original comments on the stocks below, see The Technical Indicator Library.

The specific area matches the February peak (3.22) as well as a nearly three-year range top.

Against this backdrop, the yield is rising from a bullish cup-and-handle pattern underpinned by the 50-day moving average. An eventual breakout opens the path to less-charted territory, though a near-term target projects to 3.31.

In related price action, the 10-year Treasury note yield is digesting its May spike to nearly seven-year highs, detailed last week.

The group has recently staged a bull-flag breakout, rising to challenge 52-week highs.

Muted selling pressure near resistance, across three sessions — combined with a relative strength index (not illustrated) that has reached four-month highs — improve the chances of an eventual breakout.

More broadly, consider that the transports and energy sector are frequently inversely correlated. The prevailing tandem transports and energy sector resurgence is broad-market constructive, consistent with economic strength.

As illustrated, the shares are rising from a bullish cup-and-handle defined by the April and mid-May lows.

More broadly, the range top matches major overhead, illustrated on the five-year chart.

Tactically, a breakout attempt is in play barring a violation of near-term support, circa 74.20. An eventual close atop the March peak (78.30) opens the path to less-charted territory, and potentially material follow-through.

Electronic Arts, Inc.
EA, +0.97%
is a well positioned large-cap video game producer.

Earlier this month, the shares knifed to record territory, rising after the company’s fourth-quarter results.

The subsequent pullback has been flat, fueled by decreased volume, positioning the shares to build on the initial spike. Tactically, first support matches the breakout point, circa 130, and the rally attempt is intact barring a violation.

As illustrated, the shares have rallied to the range top, rising to challenge nine-month highs.

Tactically, near-term support closely matches the 50-day moving average (36.95), a recent inflection point, and a breakout attempt is in play barring a violation. An intermediate-term target projects to the 46 area on follow-through.

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Still well positioned

The table below includes names recently profiled in The Technical Indicator that remain well positioned. For the original comments, see The Technical Indicator Library.

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